Being debt-free or at least, reducing major debts before retirement is essential to ensure that you will not run out of funds or outlive your assets post-retirement. Financial experts advise owning a home before or at retirement. Getting rid of mortgage ensures that you have sufficient funds for other expenses such as utilities and insurance payments. Create a plan to eliminate debt and avoid unnecessary financial burdens. Being debt-free before or at retirement frees you from worry and gives you a tremendous sense of achievement.

Being informed about retiree benefits, tax strategies, and Social Security is also important in achieving financial security after retirement. Know the best time to tap into your benefit to guarantee sufficient monthly payments. Enlist the help of a reliable financial adviser to assist you in utilizing smart tax strategies and maximizing your retirement benefits.

Preparation and planning are the keys to a successful retirement. It is important to create saving and spending plans and to determine the amount of money you need for your retirement. Update important documents every five years and consider estate planning. Invest in long-term care insurance as well to cover costs of home care or assisted living.

A sound financial plan can deliver the financial security that will allow you to live the desired lifestyle you worked your whole life for. Talk to a financial adviser and start planning for your retirement now.

One of the biggest appeals of post-retirement is the possibility of traveling and seeing a lot of new places around the world. However, traveling is generally not cheap and a lot of planning should be made to make sure retirees can afford it. So what steps should be made?

First, look around. Is there anything in the house that cannot be left behind for too long? The entire schedule of the trip depends on this, as much as the cost of the travel depends on the schedule.

Once the schedule is finalized, the question of how healthy the nest egg is comes into play. A healthy savings can shoulder a trip or two for a month. But if retirees want to stay in world-class hotels in cosmopolitan cities, then the bank account should match the retiree’s expectation.

Another option for retired couples is to move out of their home and into a more affordable place. They can either sell their home or have it rented out. This way, their bank accounts are replenished, giving them means to travel.

Retirees also have to consider their limitations, and think about what to do once they decide it’s time to come home. So, before going on a trip, retirees should have something to come home to.

There is a great amount of freedom to be had after retirement, and experiencing the sights and sounds in far corners of the world is as good an endeavor as any. But as in all endeavors, careful planning is always paramount.

Linda O. Foster from Poulsbo, WA, specializes in federal employee benefits. She helps in estate and retirement planning for people who want to reach their financial goals. To learn more about how Linda Foster helps retirees save money, visit her company’s website.

The young and ambitious working class has a strong appetite for spending on travel, designer clothes, gadgets, and even concerts. Their relative freedom from responsibilities, stress experienced at work, and excitement over new things have the biggest influence on their spending habits.

While there is nothing wrong about indulging in life’s luxuries, financial imbalance often results from the failure to forgo current consumption in favor of building a stash for the future. Failure to plan for future financial responsibilities can be disastrous. Below are some things that the young ones must consider to ensure a secure, sustainable, and worry-free retirement.

Cut down on unnecessary spending
People tend to spend on relatively unimportant and fleeting material things that satisfy short-term needs. The want to have the latest model of a phone, the false need to drink expensive coffee at leading coffee shops, and the desire to acquire expensive clothes are all behaviors permitted only by a robust cash flow and by already met basic needs (fixed daily expenses, emergency fund, etc.).

Maximize work benefits
Starting a job at any company is not a guarantee of high earning potential. It is vital to choose a career that has a slightly higher starting salary but still leaves enough room for growth based on skills, competence, and work ethics. It is best to look for a company that offers a retirement plan, health and life insurance, recurrent salary increases, an incentive system, and savings-like employee benefits. These, while not necessarily the key to absolute financial freedom, are the building blocks to a secure future.

Responsible marriage
Marriage is a long-term commitment that requires emotional maturity, financial preparedness, and a strong socio-spiritual foundation. Aside from the fact that a divorce is expensive, similar marital catastrophes will also divide financial assets that would create a bump in the long-term financial plan. The young must have a practical and reasonable view of marriage before making the commitment.

Get insurance and start building an investment portfolio
In investing, time is one’s best friend and worst enemy. Starting young is always an advantage because it provides a wide horizon to build wealth and try out high-risk but high-return endeavors. As for insurance, premium prices are at their cheapest for young and healthy individuals. Modern insurance products now also offer living benefits that activate without requiring the occurrence of a life-threatening incident.

Planning for retirement is never easy. It is a long-term process that requires a lot of effort and smart decision-making. Knowledge about the essentials of retirement and investment is a fundamental step to determining which processes and growth opportunities to pursue. While hiring a financial consultant introduces a system in the planning process, the investor should still be apprised of crucial points like finding a passive income, avoiding fad investing, being tax efficient, and thinking about long-term benefits.

Retirement planning is done best during youth and gainful employment. For instance, putting money early on Individual Retirement Accounts (IRAs)—basically a savings account with big tax breaks—gives people tax advantage. Although people under 50 can deposit only to a certain limit per year, the account still carries importance in terms of savings.

Similar to this platform is the 401(k) plan wherein an employee decides how much would be deducted from his or her payroll as contribution to an individual account that his employer creates on his behalf. The employer serves as the primary sponsor and partners with another company to manage the plan.

When people reach retirement, there are more ways to grow their accumulated savings, namely through stocks and bonds. Investing in stocks is as simple as buying shares of a company, making you a co-owner and gaining a portion of its profits. Stocks have high return potential and are beneficial for beating inflation in the long term. However, they also have greater risks in the shorter term.

Bonds, meanwhile, are a much more stable investment. Purchasing a bond is like lending money to a reliable borrower. The borrower pays interest on a regular basis and then recoups the principal when the bond matures. The downside includes the risk of the borrower defaulting and less potential returns compared to stock investment. For more convenient options, retirees can park their money in mutual funds, which are stocks- or bonds-based pooled investments managed by professional investment experts.

Linda O. Foster, a Washington-based financial expert, coaches her clients on the best way to reach their financial goals and enhance their retirement plans. For similar articles, subscribe to this blog.

A small amount from the paycheck goes to this plan, and the individual’s agency pays for 1 percent annually. To receive retirement benefits from this, an employee must serve for at least five years. Some of the basic benefits also cover an employee’s spouse and children in case of long-term disability and death.

Social Security

Similar to the Basic Benefit Plan, an employee pays for social security every period. But unlike the earlier plan, an employee can take this to the next employer be it private or public. Having social security includes benefits in case of disability and protection for survivors. This is a continuing benefit as it supports disabled, retired, or unemployed individuals.

Thrift Savings Plan

Just like the Basic Benefit Plan, the agency pays 1 percent of the share for each employee. Up to 5 percent of the salary may be assigned for the individual contribution. Even if the person decides to leave federal service, he or she can still gain from this plan. This could be seen as the equivalent for a 401(k) in private companies.

These three are the basic benefits federal employees are entitled to. Federal employees serve the country in countless ways, and they deserve to be compensated by the government even when they’re no longer in service.

Estate planning refers to the legal structuring of the future disposition of one’s current and projected assets. It is a NEED for both the affluent and the middle class. Once substantial assets and net worth are achieved, planning on how these should be transferred (in case of death) to the heirs should be made in advance. It is essential to control the disposition of these assets and to minimize the taxes imposed by both the state and federal governments.

While completely eliminating estate taxes may be difficult, it is possible. This involves a thorough analysis of the assets being considered and requires expert strategies from financial planners. At the most basic level, estate plans may involve credit-shelter trusts, traditional life insurance, and similar instruments. The “death benefit” in life insurance, which is completely tax-free and easily accessible by the beneficiaries, can be used to pay the estate tax.

Because clients have different types of assets under their portfolio, some more sophisticated approaches to wealth transfer may be needed. Foreign grantor trusts, private dynasty trusts, placement life insurance, mutual funds, and some types of leveraged gifting are less simple than an ordinary life insurance, but they work from both an income and transfer tax perspective and allow the client to achieve his or her personal goals.

Linda O. Foster provides federal employees of all ages with both sound advice on retirement and estate planning and economical, tax-advantaged investments to help them reach their financial goals and enhance their retirement plans. To know more about her, visit this LinkedIn page.

Planning early for your retirement is key to achieving long-term financial goals. The process is quite extensive but need not be too demanding or exhausting. It may seem like a tall order, but it can actually be done in simple steps that you can confidently accomplish (with proper discipline, of course):

1. Decide at what age you would like to retire. Setting the time to bid goodbye to employment will give you enough opportunity to start building your nest egg. At any age, however, saving for retirement should start 20 to 30 years earlier. So if you wish to retire at age 60, start planning at age 40 at the latest.

2. Determine how much you will need for retirement. Calculating for your future financial needs as a retiree does not require complex mathematical equations. Retirement income will largely depend on variable factors such as your current earnings, your desired kind of lifestyle, and even unforeseen events like illnesses and medical expenses. For the best estimate, however, it will be of great relief if you seek the help of a professional financial planner to assist in computing for your ideal retirement fund.

3. Build your retirement fund. While stashing cash in the bank is not necessarily a bad idea, it would make more sense to park your money in more high-yielding securities such bonds, stocks, UITFs, or mutual funds. These investments are quite risky in the short term, but they have consistently shown massive returns over time.

4. Know what resources you have. After identifying the size of the fund that you need for your retirement and deciding on which money machine to use in building the fund, now it is time for you to check on where to source the fund. The most common source is your current employment or business. Discipline yourself in allocating a comfortable portion of your income for your retirement on a monthly basis. Other sources that you can also consider are bonuses, commission income, existing savings, liquid assets, or even inheritance if you have received one.

5. Periodically review your retirement plan. It is very important that you reassess your retirement plan every now and then. Make necessary adjustments especially that life has plenty of surprises that would often force you to rethink your finances.

Linda O. Foster is a Washington-based federal employee benefits specialist specializing in estate and retirement planning. For more about her background, click here.